—However, as technological improvements allow the nuclear medicine community to move forward in accessing N13, C-11 Choline, and where the industry is looking toward new PET perfusion compounds in the ability to make the right clinical choice for the patient, this does become a challenge under the bundling concepts.

Ultimately, the challenge with bundling is that the CMS makes its payment policy decisions based upon hospital charge data submitted two years in retrospect and attempts to tease out what radiopharmaceuticals were used in conjunction with the packaged CPT codes. The agency then attempts to derive an average reimbursement rate. A past survey of hospital charge data showed that a dose of Sestamibi was reported to cost between $15 and $1,800, demonstrating that the hospital charge data is less than consistent, and the reported costs for radiopharmaceuticals vary widely from institution to institution.


Another good example of the disadvantages of bundling is white blood cell tumor imaging. If an institution chooses to use gallium or thallium, the reimbursement is very fair. However, if the best choice for the patient is the use of Prostascint, or Octreoscan, the drug costs far exceed the packaged reimbursement for the overall procedure. Based upon the system of averages used in the prospective payment system bundling algorithm, low volume of newer agents will always present a problem. Inherently, newer, specific agents will have lower volumes than higher volume. Therefore, the contribution to the margin for less specific agents in the overall payment package is nominal, creating a huge disparity resulting in lower financial incentives for use of an often more appropriate, but more expensive test.

Will the packaging policies proposed by the CMS policy hinder innovation for the imaging industry and its ability to develop new compounds? Further, even if industry can find ways to innovate, will the facility have the means to afford to use new treatment options? Full exploration and response to this question takes more time and word count afforded to us in this article, but let's examine a few current challenges that perhaps offer some insight into the thinking of the U.S. Department of Health and Human Services (HHS) and its vision to reshape health care in this country and how the Administration is leveraging the Medicare program as a catalyst for change.

Today, the CMS discriminates among radiopharmaceuticals. It allows new diagnostic and therapeutic products to enter the market and enjoy separate payment under a policy called "pass-through" for up to three years. When the "pass-through" period expires, diagnostics are bundled while therapeutics continue to be separately reimbursable. For most manufacturers, reimbursement is a tremendous hurdle. Approval by the U.S. Food and Drug Administration (FDA) does not guarantee reimbursement. A great example of this issue is Eli Lilly's compound Amyvid. Amyvid received approval of its New Drug Application (NDA) more than one year ago and in July of this year the CMS only further complicated reimbursement concerns for Lilly by publishing a proposed National Coverage Decision (NCD) memo proposing to only allow very limited coverage for Amyvid. The agency concluded that the evidence does not support routine payment for use of the scan to "rule out" Alzheimer's in patients with early signs of dementia.

More Industry Headlines